Two studies are proposed. The first study will seek to clarify the extent to which preschoolers with specific language impairment (SLI) have speech processing deficits. The second study seeks to determine whether the relative superiority of two language interventions in children with SLI depends on pretreatment speech processing ability and its behavioral correlates. Sixty children with SLI in Brown's stage I - IV will be recruited in this project. Additionally, 60 typically developing children matched for age, gender, ethnicity, and SES will be used to address the questions for Study 1. At entry into the study, language and speech processing will be tested. Speech processing will be measured with event-related potential and behavioral measures. For study two, the SLI children will be randomly assigned to one of two treatment groups: Milieu Language Teaching (MLT) or Broad-Target Recast (BRT) treatment. These children will receive treatment in a 1:1 format for 30 minutes/session, 3/week for 6 months. Grammar will be tested again twice during the treatment phase, immediately after treatment, and at two follow-up periods. General measures of expressive and receptive language and speech processing will be repeated at the last period. Multiple regression, multivariate permutation tests, and growth curve analyses will be used to test the research questions. Five years of funding are requested.